The effects of non-metallic inclusions in nucleating acicular ferrite in steels during cooling from a weld or cooling from an austenitic temperature are reviewed. The influence of the acicular ferrite (AF) structure on mechanical properties of steels such as strength and toughness is briefly mentioned. The different factors affecting the formation of acicular ferrite, such as the soluble content of alloying elements in steel, cooling rate from austenitizing temperature, austenite grain size and inclusion characteristics in steel, are discussed. The mechanisms of acicular ferrite formation on non-metallic inclusions, such as reduction of interfacial energy, mismatch strain between the inclusion and ferrite/austenite, thermal strains at the inclusions and changes in matrix composition near the inclusions are also discussed. Finally, the effects of inclusion characteristics, such as size, number and composition are described and their effectiveness in nucleating acicular ferrite is discussed.